Sunday, November 23, 2008

Opinion: Is the bail out of the auto industry a good idea or a bad idea? How do you feel about President-elect Obama's plan?

Obama "Radio Address" 11-22-08

26 comments:

Vince said...

I am personally not a fan of the auto bail out. I know it needs to be done, but this could lead to a downward spiral for other industries as well. Other companies see all these bailouts and assume that they are garenteed a free sum of money. The auto industry needs help but we shouldnt just give the money away. Offer an incentive to the companies so that the gov. gets its money back. The bail out needs to be done, but we need to think about how we are going to be able to give more money out for free.

Addie said...

I'm sort of in favor of the bailout. If we can give the thousands of workers in the auto industry jobs, that'll be a good push toward healing the economy.

The only reason i'm not gung-ho about the bailout is that I don't think we can afford it.

No matter how many jobs we can give back, we're digging ourselves deeper in the debt hole if were spending money we don;t have.

Kyle K said...

I am opposed to the bail out of the auto industry. It is obvious that the auto companies' current business plan isn't working so why would you throw more money at a failed plan. I feel the auto industries need to work this out on this on their own.

kylem27 said...

As an automotive enthusiast I believe that there should be a bailout. In some cases, its not automakers fault that they are where they are today.

Chrysler for instance, back in the early 90's was in major trouble. So much so that they named the new models LH, which means Last Hope. In 1998, they were bought out by Mercedes who raped them. They only put themselves first and didn't do much for Chrysler. Next, about a year ago, they were bought out again by Cerberus, an investment firm. The problem here is that an investment firm has absolutely no idea how to run a car company.

Also, think of the impact that the big 3 (or Beg 3 as an internet site put it lol) have had on American history. I remember hearing on the news that if GM went under, tens of thousands of jobs went under. Think of how long that depression would last.

JamieW said...

I think the auto bailout might become necessary. Help is definitely needed by these companies and considering how many jobs the industry provides zooms in on the importance of the bailout.

P.S Congrats, Bretzmann, on your 100th win :-)

Mr. Bretzmann said...

Jamie...thanks, I appreciate it.

Why bailout AIG and Citigroup, but not the auto industry? Is it because the auto industry has Union jobs that pay living wages and provide real benefits? Hmmm?

Happy Thanksgiving.

mlowe1191 said...

OK well I’ve been waiting to write about this, but in class would make it so much better. The auto industry is as American as apple pie. We have so much invested in the big 3(not just jobs, but stock among other things). I think that we NEED to bail them out. Yes it is costly, yes its just adding on to the people we are ailing out, but it needed to be done. 246,000 work at ford, 252,000 at GM, and 200,000 + with Chrysler that’s a lot of jobs that could be gone. And these are high quality, great job, with good pay and benefits, as well as supporting good old American unions. I’m not saying that we give them Billions for free, i suggest we give them billions with requirements. For instance set up a time table for them to have a non gas using vehicle on the market for under $30,000 or under $20,000. Also say by like 2009, make a vehicle that get 40 miles a gallon, 2010= 60MPH, 2011=100mpg. Something where it helps everything we are pushing for the environment and still saving the auto industry.

Mr. Bretzmann said...

Happy Thanksgiving:

http://www.whitehouse.gov/holiday/thanksgiving/2007/

kylem27 said...
This comment has been removed by the author.
kylem27 said...

The problem with making them spend money on fuel efficient vehicles is that at the moment, they are not as profitable as they were a couple months ago. Also, around this time last year, Congress passed a bill making the CAFE standard 35 mpg for cars and 35 for SUV's and trucks in 2020, compared to 25 for cars and I believe there isn't one for trucks and SUV's. This alone will make them look into fuel efficient vehicles.

Also, another thing that I read about back in late June or Early July (obviously things have changed a helluva lot since then)is that each of the Big 3 need a "home run" to get them out of the rut they are in right now. Meaning that they need to have a car that sells like no other. (Think 1964 Mustang or 1983 Chrysler Minivan) Only thing is that they are still competing with each other so they all can't have the best truck, or the best mid-size family sedan. Chevy's new Malibu is the closest to being this for GM. I'm not even a Chevy fan and I like it.

JeremyL said...

I think we have to do the auto bailout to be fair. We can't just bail out a bunch of other companies and then just forget about the auto industry. It will be expensive but i think it is something that needs to be done. Plus it will keep jobs around which is a must with the way the economy is. I just dont know if we can keep going like this because once we bail out one industry another one will complain and then another...When will it end?

Sergeant K. said...

Now that Ive seen what the money is going for, Im starting to wonder if all this money for companies is a good thing. I read somewhere that if they took the 8 Billion they just dished out and broke it up between all Americans 18 and older, everyone would get like 5k in spending money. honestly,I think that would jumpstart the economy a little faster in my opinion. Dont get me wrong, paying some of the banks is necesary but I think that rather than having people buying new cars they might save themselves the expense and the gas to, y'know, ride the bus.

P.S. I had a safe but unsuccessful hunting trip and I will be back in class on monday

- Erik K.

nathanl said...

I agree with Vince, in that we can't be giving them free money. Before we give the car companies any money, we should make sure that the come up with a new business plan (as Kyle K. implied) that will make the bailout a good investment.

mlowe1191 said...

Happy Thanksgiveing all!

Alex H said...

I'm against the auto bail out. It doesn't need to be done. Yes, there are companies failing now. Should we bail all of them out? How do we decide which ones deserve to be bailed out? How would bailing out the failing companies be fair to the ones that are still staying afloat?

Other, smaller, companies who are in trouble are going to be demanding money as well. It isn't the government's job to bail out failing companies or decide who gets bailed out. The jobs of the government are to make and enforce laws, and decide if these laws are constitutional. The government is not made of money to be spending it like this. We are in debt, and all the money that they are spending comes from us and our families. Personally, I don't think that bailing out the auto industry will have a huge ripple effect. Also, why are we going to be throwing more money at a failed business plan?

I did have a much better comment to post, but my computer deleted it. :(

Ryan K said...

The bailout of the car industry is a terrible idea. I was speaking with my Dad about this issue just recently. He used to design paints for the auto industry and had an inside look at how some of the factories were run. He said one thing he observed was that the unions are destroying the company. He repeatedly saw jobs that could have been done by one person instead being done by three, inspectors reading the newspaper as parts passed by on the assembly line.

The unions are what are controling the auto industry. Now this may seem harsh and mean but declaring bankruptcy would surely place the unions in line. This is why I personally oppose the car bailout.

Alli B said...

I'm on the fence about the auto bailout because it seems like either way the economy is going to suffer. The auto industry being bailed out means we will have an even bigger debt than we already have. Without the bail out the industry will take a huge blow and many jobs will be lost.

MattC said...

I think the auto bailout is a good thing, because there are too many jobs out there that are tied to the industry in some way. It also contains a lot of the depleting "blue collar" jobs in the country such as manufacturing plants etc...

It's necessary and needed and I think Obama's plan will take care of it. We have already allocated $700 billion for the financial bailout and just 20 billion to save the auto industry is fine compared to the consequences.

mevanoff said...

If we are in this so called "recession" how can we afford to bail out the auto industry? This bailout will just put us into a bigger hole.

Sergeant K. said...

I was looking more into some of the costs now that the asking price from the big three has gone up and honestly, I think this bailout is a mistake. New car purchases are down 48% because of the recession. If we gave them the 34 billion, they would use it to save production rates and keep jobs. however, with car sales in the hole all of the companies would be in the same place in 6-12 months anyways! 700 billion was bad enough but this time i think we need to let them file bankruptcy and suffer losses like everyone else. Smaller businesses are failing left and right, and you dont see them begging for 34 billion and offering for a 1 dollar a year salary. Besides. even if the ceo's get it and take the dollar, its not like their going to have it rough like the rest of us for the next couple of years...

kylem27 said...

Here is a reason why there should be no bailout. And I'm gonna pick on my boys at Chrysler again.

The pricing system over there is really #@$%ed up. For my car, you can buy a thicker rear sway bar, (off the Chrysler version) for $18. I bought mine back in Feb. for $11. The stock one for my car is $115. Like you can walk into a dealership and buy a $115 part and walk out missing $18. Also, online over 100 people have bought these, so you can imagine the losses.

Another example of the same thing is this. The camshafts in the 3.5L Intrepids, Concordes and 300M's cost $330 each. The camshafts in the 4.0L (same engine, just a longer stroke)in the new minivans, Pacificas, and Nitros cost $42 a piece. So basically, they are losing $300 on each camshaft. These don't wear out very often, but you can see the losses.

And taken from an Internet forum that I peruse, "I replaced a filter/water separator/heater unit on a Dodge Ram with a Cummins a while back -- normally a $300 unit -- they had it priced at $34 at the dealer." Again, many losses there too.

Sergeant K. said...

Today I heard the proof. I turned on my radio this morning to hear an add for a car dealer. the ad said "The other dealers havent' figured ito ut, but we have the solution! Now, you can get 50% off any new vehicle with free Lifetime Waranty!" Can you say desperate a touch?

tylerl said...

I feel the auto bail out is a mistake. We should let them fall, declare bankrupcy and start a clean slate. This would help them compete with forign car companies because it would mean the possible end of the unions. These unions in the auto industry demand very high salaries and benifits. This is a large reason why the U.S. auto industry cant compete with its forign competetors, which dont have a problem with unions.

dlang said...

the bail out for the auto idustry is absolutly necessary. This is very important to keep the economy going and our auto industry booming. obamas plan is allright in my opinion. I think it will work eventually but it will take alot of time.

Josh DeGrave said...

I think the bail out of the auto industry was a good idea. As you can see, it is still operating fine and has created tons of jobs for many unemployed Americans. It was a risk giving money to an industry that failed, but it did pay off. I think we need to keep pushing for more available jobs to get the unemployment rate down.

Brittany Warnell said...

As much as this would bring jobs to America, I don't believe that it is a good idea. Now that the economy is not in it's best shape, more people are trying to save money by buying less and finding better ways of transportation. There are more people walking, carpooling, biking, and taking buses to work and other places than before and so this bailout would not be the best idea. Now people don't always have enough money to buy a new car.